Africa tipped to be next offshore growth area

It will never overtake China and India, but as people look to take more advantage of globalisation rather than offshoring, then Africa will continue to grow as an outsourcing destination.

In short, Africa has become one of the fastest growing offshoring destinations in the world.

According to the 2009 A.T. Kearney Global Services Location index, (which looks at the financial attractiveness of a country, the people skills and availability, the business environment to form its total score):

Egypt is the sixth most popular location moving up from 13th, Ghana has moved from 27th to 15th, Tunisia 26th to 17th, Senegal 39th to 26th, Morocco from 36th to 30th And interestingly South Africa has moved the other way from the 31st- to 39th.

Looking at Africa it is important to realise that you can divide the country into three areas, firstly Northern and Saharan Africa, the up and coming West and East African countries and then Southern Africa, particularly South Africa.

Northern Africa

Egypt has become a much more popular destination as Professor Leslie Willcocks has pointed out in recent research. American giants such as IBM and EDS, now HP, have both had operations here for some time and interestingly, Wipro and Infosys have been expanding into Cairo, thereby taking advantage of the availability of low cost well qualified people. Egypt, like Morocco, also has huge support from the government to expand this ability which is key to sustainable success.

Moving along the African coast, then Morocco has rapidly found its presence as a supplier of outsourcing services to the French market. Until recently, Morocco's outsourcing market had focused on call centres, but its expansion into banking/ insurance, telecommunications and information technology is being supported by infrastructure investment and the development of four outsourcing hubs at Fes, Marrakech, Tangier and Casablanca. A good example of increased presence is Capgemini's recent investment in Morocco, providing sourcing services to the French market and interestingly companies are also providing outsourcing services to the Spanish market. Tunisia meanwhile is looking to emulate Morocco's success.

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